Investor Backlash Against “Addictive” Smartphones and Social Media!

There is a growing backlash against companies that are offering devices and services that many feel are addicting children to technology. Here is an excerpt in an article in today’s New York Times that reviews the issue.

“A creator of the iPhone called the device “addictive.”

A Twitter founder said the “internet is broken.”

An early Facebook investor raised questions about the social network’s impact on children’s brains.

Now, two of the biggest investors on Wall Street have asked Apple to study the health effects of its products and to make it easier for parents to limit their children’s use of iPhones and iPads.

Once uncritically hailed for their innovation and economic success, Silicon Valley companies are under fire from all sides, facing calls to take more responsibility for their role in everything from election meddling and hate speech to physical health and internet addiction.

“Companies have a role to play in helping to address these issues,” said Barry Rosenstein, managing partner of Jana Partners, an investment firm that wrote an open letter to Apple this weekend pushing it to look at its products’ health effects, especially on children. “As more and more founders of the biggest tech companies are acknowledging today, the days of just throwing technology out there and washing your hands of the potential impact are over.”

The backlash against big tech has been growing for months. Facebook and Twitter are under scrutiny for their roles in enabling Russian meddling in the 2016 presidential election and for facilitating abusive behavior. Google was hit with a record antitrust fine in Europe for improperly exploiting its market power.

But until now, Apple had escaped largely unscathed, and concerns about the deleterious effects of excessive technology use have not been among the most pressing matters for Silicon Valley executives.

Jana, an activist hedge fund, wrote its letter with Calstrs, the California State Teachers’ Retirement System, which manages the pensions of California’s public-school teachers. When such investors pressure companies to change their behavior, it is typically with the goal of lifting a sagging stock price. In this case, Jana and Calstrs said they were trying to raise awareness about an issue they cared deeply about, adding that if Apple was proactive about making changes, it could help the business.

“We believe the long-term health of its youngest customers and the health of society, our economy and the company itself are inextricably linked,” the investors said in the letter.

Jana, which is often vilified for its aggressive focus on short-term profits, also said it would be raising a fund this year that would engage in more such campaigns, an effort that could help soften its image.

Whatever the motivations, the two large investors are tapping into the growing anxiety among parents about their children’s preoccupation with devices, at the expense of activities like reading and sports.

“Over the past 10 years, there’s been a bottom-up backlash,” said Sherry Turkle, a professor at the Massachusetts Institute of Technology and the author of “Alone Together: Why We Expect More From Technology and Less From Each Other.” “You see it in things like people not sending their kids to schools that use iPads, and kids telling their parents to put their phones down.”

For years, researchers have been sounding the alarm over the ubiquity of mobile phones and social media. A 2015 study by Common Sense Media, a research group that studies technology use, found that more than half of teenagers spent upward of four hours a day looking at screens, and that for a quarter of teenagers, the figure was more than eight hours. In anothersurvey, in 2016, half the teenagers said they felt addicted to their mobile devices.

“These things can be incredibly addictive,” said Tony Fadell, a former Apple executive who helped create the iPod and iPhone. “It’s amazing, but there are a lot of unintended consequences.”

Unintended consequences indeed. Unabated this “addiction” will have its most serious consequences in the years to come. Parents make sure you read a book or a magazine in front of your children on a daily basis and encourage them to do the same. And have dinner together as much as possible and discuss what is important in each other’s daily lives.